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Danske Bank CEO Steps Down Over Money Laundering Scandal

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Danske Bank A/S's Chief Executive Thomas Borgen resigned on Wednesday after the Danish lender announced the results of an internal probe relating to a money-laundering scandal in its branch in Estonia that involved payments of about 200 billion euros.

Danske Bank said its investigation covered about 15,000 customers and a total of around 9.5 million payments through the branch during the period from 2007 to 2015. The total flow of payments covered by the investigation amounted to around 200 billion euros.

The investigation was launched in 2017 and carried out by an external law firm, Bruun & Hjejle.

The bank said it was not able to provide an accurate estimate of the amount of suspicious transactions. However, some 6,200 customers were found to have hit the most risk indicators and they have been reported to the authorities.

Danske Bank added there is suspicion that there are employees in Estonia who have assisted or colluded with customers making suspicious transactions. However, its investigation concluded that the board of directors, chairman, and the CEO did not breach their legal obligations.

"The Bank has clearly failed to live up to its responsibility in this matter. This is disappointing and unacceptable and we offer our apologies to all of our stakeholders...," Ole Andersen, Chairman of the Board of Directors of Danske Bank, said.

Danske Bank said it will donate gross income worth 1.5 billion Danish kroner to an independent foundation that will be set up to support initiatives aimed at combating international financial crime.

Separately, CEO Thomas Borgen said he has informed the bank's board of directors of his intention to resign from his position at Danske Bank. However, Borgen will continue in his position until a new CEO is appointed.

"Even though the investigation conducted by the external law firm concludes that I have lived up to my legal obligations, I believe that it is best for all parties that I resign," Borgen said.

Danske Bank also lowered its forecast for 2018 net profit to a range of 15 billion to 17 billion Danish kroner. Earlier, the bank expected net profit to be at the lower end of the range of 18 billion to 20 billion kroner.

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